Hogan v. Postin

695 P.2d 1042, 1985 Wyo. LEXIS 454

• Court: Wyoming Supreme Court
• Decided: February 25, 1985
• Docket: 83-178
• Status: Published

Opinions

ROSE, Justice.

Subcontractor Rick D. Hogan, d/b/a Cheyenne Sash & Door, brought suit against Reiman Construction Company and Robert W. Postín, the contractor and architect respectively on the restoration of the historic Tivoli Building in Cheyenne. Hogan’s complaint against Postín is the subject of this appeal. Hogan claimed that Postín made a measurement error in the architectural drawings of a window layout, and that as a result of this mistake Hogan incurred additional expenses of $2,413 in completing his portion of the project. The county court found in favor of Hogan, and an appeal was taken to the district court. The district court reversed the judgment against Postín on the basis of Hogan’s failure to obtain a written agreement to pay for the extra work from the contractor or the owner of the building (the City of Cheyenne) as his contract required.

We will affirm.

FACTS¹

As an agent for the City of Cheyenne, architect Postin supervised portions of the restoration of the Tivoli Building. Hogan subcontracted to do mill work and wood work under the direction of Postin.

While preparing the shop drawings for two storefronts which were to be constructed by Hogan, a discrepancy was discovered between the ceiling height as it appeared on the original blueprint and as it was measured in the field, and adjustments, therefore, had to be made in the dimensions of the windows and the sills. Hogan notified Postin of the measurement difference, and Postin instructed him to make the windows the size indicated on the blueprints. The sill height was then necessarily 39 inches instead of the 27 inches appearing on the blueprints.

Hogan built the storefronts in his shop pursuant to Postin’s instructions. The day after the east storefront was installed, Hogan was notified that Postin was dissatisfied with the sill height. Upon speaking with him, Hogan learned that Postin wanted the sill height to be one foot lower (27 inches). Hogan and Postin discussed the best procedure for making the changes which were necessary for historical accuracy. Hogan said he would keep track of the time and materials required in making the changes, but no actual arrangements for payment were made. Mr. Reiman, the general contractor, agreed that the sill height was wrong and told Hogan to proceed with the alterations.

In his complaint filed in county court, Hogan sought $2,413, the total amount of the invoices on the alterations, plus interest against Reiman Construction Company and/or Postin. Civil judgment was entered against Postin for the entire amount. The district court reversed on contract theory, finding that Hogan could not claim the right to be paid by anyone, including Pos-tín, when he had not complied with the clear requirements of his contract.²

THE ISSUE

Appellant states the issue as follows:

“ * * * [Wjhether, by virtue of a contract executed between a contractor, Rei-man Construction Company, and a subcontractor * * * Appellant can recover from the supervising architect * * * monies expended because of appellee’s miscalculation and error in measurement of dimensions on the appellant’s worksite.”

The issue is more succinctly stated as whether or not the appellee-architect owed a contractual duty to the appellant-subcontractor based on a contract to which appellee was not a party. While we agree with the outcome of the district court decision, we do not believe it is necessary to reach the question of whether or not the appellant complied with the proper procedure for securing payment for additional work. In affirming the judgment of an intermediate court, we may consider grounds not noticed or passed upon by the intermediate court. 5B C.J.S. Appeal and Error § 1815, p. 151, and cases cited therein. We have said that the trial court should be affirmed if it is correct on any theory. Valentine v. Ormsbee Exploration Corporation, Wyo., 665 P.2d 452 (1983); Heyl v. Heyl, Wyo., 518 P.2d 28 (1974); White v. Wheatland Irrigation District, Wyo., 413 P.2d 252 (1966). Relying on the disclosed-principal³ concept, we hold that Postín owed no contractual duty to Hogan.

THE LAW

This court adopted the disclosed-principal rule in Thomas v. Gonzelas, 79 Wyo. 111, 331 P.2d 832 (1958). In that case, we held that an electrician did not state a cause of action against a lessee who ordered the installation of additional electrical equipment as an agent of the lessors. We accepted the position of Restatement of the Law, Second, Agency 2d § 328:

“ ‘An agent, by making a contract only on behalf of a competent disclosed or partially disclosed principal whom he has power so to bind, does not thereby become liable for its nonperformance.’” 331 P.2d at 834.

Also see Starrett v. Shepard, Wyo., 606 P.2d 1247 (1980); Kure v. Chevrolet Motor Division, Wyo., 581 P.2d 603 (1978); 3 C.J.S. Agency § 365, p. 180.

In the case at bar, the appellant was well aware of the fact that the Tivoli Building was owned by the City of Cheyenne and that Postín was supervising the project as an agent for the City. In ordering Hogan to correct the sill heights Postín was acting on behalf of the City, and thus did not become personally liable for payment on a contract. Thomas v. Gonzelas, supra; Restatement of the Law, Second, Agency 2d § 328.

In Thomas v. Gonzelas, supra, this court also recognized the rule set forth in 3 C.J.S. Agency § 215 (now 3 C.J.S. Agency § 365):

“ ‘An agent who contracts on behalf of a disclosed principal and within the scope of his authority, in the absence of an agreement otherwise, or other circumstances showing that he has. expressly or impliedly incurred or intended to incur personal responsibility, is not personally liable to the other contracting party * * V ” 331 P.2d at 834.

Hogan does not allege that Postín expressed any intention of becoming personally responsible, although Postín did admit that the error was his fault. Absent an agreement to assume liability for nonperformance of a contract, an agent is not personally liable.

Appellant argues that Postin did not have the authority to bind the City to pay for his professional “mistake, error and miscalculation.” We do not agree. In an early Nebraska case, a contractor was suing an owner for an unpaid balance on a contract for the construction of a house. The contract required the builder to perform

“ ‘ * * * agreeably to the plans, drawings, and specifications prepared’ by an architect named, to the satisfaction and under the direction of said architect.” Erskine v. Johnson, 23 Neb. 261, 36 N.W. 510, 511 (1888).

The architect made a mistake in drawing the grading line which resulted in additional work for the contractor. The owner of the home attempted to avoid liability, relying on a provision in the builder’s contract requiring that extra work be contracted for in writing. The Supreme Court of Nebraska held that the writing provision was modified or waived because of the directions of the architect, and said:

“ * * * As between the architect and [the owner], no doubt the architect would be liable for any mistake in the plans and specifications which increased the cost of the building; but as between the architect, who has the sole supervision of the work, and the contractor, the architect will be so far the agent of the owner as to bind him for alterations made necessary by the mistake of such architect, in order to complete the building according to contract; as where the plans and specifications called for windows which are too large or too small, whereby loss is occasioned to the contractor.” (Emphasis added.) 36 N.W. at 512.

That holding is directly applicable to this case and leads us to conclude that Postín did have the power to “bind” the City within the meaning of Restatement of the Law, Second, Agency 2d § 328 and is, therefore, not personally liable for the amount of the invoices as claimed by Hogan.

The position that Postin did have the authority to order the refabrication of the storefronts is also supported by the language of the only document before this court which is indicative of his authority. A provision of the subcontract agreement requires Hogan to perform his contract

“ * * * according to the plans and specifications * * * of Robert W. Postin, Architect, and to the full satisfaction of said Architect.” (Emphasis added.)

The implication of this provision is that Postin could require performance meeting his standards and could require that mistakes be cured. The language of the subcontract agreement is evidence of the actual authority of Postin to bind the City of Cheyenne.

Because Postin acted as an agent for a disclosed principal, expressed no intent to assume personal liability and acted within his authority in ordering the correction of the storefronts, we hold that Postin owed no contractual duty to the appellant according to the disclosed-principal concept.

Affirmed.

1 . Any factual discrepancies have been resolved in favor of the appellant, who prevailed in the trial court. Younglove v. Graham & Hill, Wyo., 526 P.2d 689 (1974).

2 . The subcontract agreement specifically required:

“Seventh. No extra work or changes under this contract will be recognized or paid for, unless agreed to in writing before the work is done or the changes made; in which writing shall be specified in detail the extra work or changes desired, the price to be paid or the amount to be deducted, should said changes decrease the amount to be paid hereunder."

3 .Restatement of the Law, Second, Agency 2d § 4(1) defines “disclosed principal”:

"If, at the time of a transaction conducted by an agent, the other party thereto has notice that the agent is acting for a principal and of the principal’s identity, the principal is a disclosed principal.”